Medical billing is one of the most critical tasks in medical practice management. Just like every coin has two sides, there are both pros and cons to outsourcing the billing process. The process involves various tasks – patient enrollment and verification, coding, billing and reconciling accounts, and accounts receivable (AR) collections. Its important to analyze the various factors involved in order to decide whether to perform these tasks in-house or entrust them to a service provider.
Managing billing in-house would allow physicians to be in control of operations and AR, have trained billers on the job, and manage and monitor the staff. Issues can be dealt with as and when they occur and changes made immediately. The physician can monitor the entire process.
Now lets look at the drawbacks of this option:
- Higher Costs – More money would have to be spent on software programs, payroll expenses, and equipment such as computers and software, and additional storage space for records and other materials
- Staff – It is very difficult to find the right staff with excellent billing knowledge and experience, and good work ethics.
- Support – If the department is small, efficiency and returns would depend on the competency of the billers. The absence of one employee can have a major impact on the revenue cycle.
The advantages of contracting out billing processes are
- Expert Team – Professional outsourcing companies have a team of trained and experienced AAPC-certified coders and billing specialists. These experts are well-informed about the latest government and payer regulations as well as prevailing CPT codes and ICD-9 codes, in addition to being ICD-10 ready.
- Time Saving – Physicians get more time to focus on providing quality care to patients, which improves patient satisfaction. Physicians who are preoccupied with financial matters would find it difficult to provide efficient care too.
- Accuracy in Claim Preparation and Submission – Hiring an experienced professional vendor will minimize errors related to improper coding, slow claims processing and inadequate follow-up.
- Improved Cash Flow – With the timely and accurate submission of claims and the increased reimbursements, cash flow improves. Claims are also submitted faster, with quick collections as the team is not distracted by other tasks.
- Better Consistency – Submitting claims and appealing denials would not an issue since the vendor would have the resources and personnel to manage the entire process at all times.
Outsourcing could also have some disadvantages
- Physicians very little direct control over the billing process
- Hidden fees for things like setup, printing statements or contract cancellation.
- Risk of leakage of sensitive patient details
- Lack of access to information and communication between the medical practice and vendor
However, these issues can be avoided by partnering with an established HIPAA-compliant medical billing vendor. A reliable vendor can provide solutions on the practice software or their own, and allow the physician access to the software to keep track of the process. They would also provide customized monthly reports to their clients. An established medical outsourcing company would also provide services that can help physicians save as much as 30-40% on their costs.